The Portland Metro region has only one industrial site of 50 acres or larger that would be ready for development in 180 days and only five sites of 25 acres or larger that would be ready in 180 days, according to a new study conducted by the Portland Business Alliance, the Port of Portland, Business Oregon, Metro and the Oregon chapter of NAIOP. Currently over 65, 000 jobs in the Portland region are the result of business operations on industrial land of 25 acres or more. Development on industrial sites tends to come in fast and furious booms during economic recovery periods. In fact, 50% of all industrial land was consumed in two, three year bursts between 1996-1998 and 2006-2008. If the next boom comes, we won’t be ready and Oregon will miss out on high-paying, traded sector manufacturing jobs. Read the report to learn more about the shortage.
A second phase of this study is just wrapping up. In this phase study partners looked at 11 of the sites that had been identified in the first phase of the project as not being ready for development. The sites had multiple challenges including ownership aggregation, infrastructure issues such as water, sewer and transportation services, and brownfields, wetland and floodplain issues. The group assessed the development potential for each site, selected a development example for each, and then modeled the cost of making the site ready as well as the job creation and property and payroll tax generation for each site. The analysis included a timeline for each site based on the time needed to accomplish permitting, infrastructure development and remediation work.
The findings: Site costs range from a low of $25,000 per acre to a high of $1 million per acre. Time to market ranges from a low of 21 months to a high of 5 years for sites that do not require ownership aggregation and longer for those that do require aggregation. Job creation benefits ranged from a low of 382 jobs on one site to nearly 3,000 at another. Annual payrolls ranged from $17 million at one site to nearly $400 million at another.
One key finding is that, while the local jurisdictions and the private sector carry the financial and risk burden of making sites development ready, it is the state, through the payroll tax, that is the biggest winner if development occurs. This raises the question of what role the state should have in working with local communities and the private sector in moving sites to development readiness.
We expect this to be a major topic of conversation over the course of the year and at the Leadership Summit in December.